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principles, must be determined by the nature of the power on which it is founded. A few instances will suffice to explain what I mean. A law that punished a citizen for an innocent action, or, in other words, for an act, which, when done, was in violation of no existing law; a law that destroys, or impairs, the lawful private contracts of citizens. ... It is against all reason and justice for a people to intrust a legislature with such powers; and, therefore, it cannot be presumed that they have done it." 1
It must be remembered that in all the leading cases in which the court had occasion to consider and construe this clause, it had not the aid of a knowledge of its history to throw light upon it. The Madison Papers were not published until 1840, some years after Chief Justice Marshall's death; and even the Journal of the Convention was not published until after the decision in the Dartmouth College case.2 Neither does it appear that the judges were aware that the language of the prohibition was derived from the civil law. In Off den v. Saunders, Mr. Justice Trimble cites Justinian's definition of an obligation; but even he does not say that the clause had its origin in that source. It is to be regretted also that this clause never came before the Supreme Court for construction while Judge Wilson was on the bench.s
The first case in which the court had occasion to consider it, was Fletcher v. Peek, argued and decided in 1810.4 It was a case of a grant of land made by the legislature of the State of Georgia, which a subsequent legislature had annulled and repealed, on the ground that the first grant had been obtained by fraud. It will thus be perceived that the contract was executed, and one of the questions before the court was, whether the prohibition extended to executed as well as to executory contracts; and a majority of the court held that it did.
"A contract," says Chief Justice Marshall, "is a compact between two or more parties, and is either executory or executed. An executory contract is one in which a party binds himself to do, or not to do, a particular thing: such was the law under which the conveyance was made by the governor. A contract executed is one in which the object of contract is performed; and this, says Blackstone, differs in nothing from a grant."
1 Colder v. Bull, 8 Dall. 888. * The preface bears date October, 1819.
» He died in 1798. « 0 Crunch, 87.
Although in the view which we have taken of the meaning of the phrase obligation of contracts, it is a rather broad construction to apply it to a grant, yet this is one of those questions which, when once decided, had best not be reopened.1 The grant of land by the State of Georgia in this case, was a purely pecuniary transaction. It was a private contract; for the question whether a contract be a public or private one, must depend upon its subject-matter, and not upon the parties to it. This being so, and it being the opinion of the court that the clause in the constitution was broad enough to include executed contracts, the case clearly fell within the prohibition.
A further remark, however, ought to be made with respect to the language of Chief Justice Marshall in this case, so far as it applies to a grant between private parties. A statute might affect these in divers ways. If the legislature declared that a grant made by A to B was utterly null and void, and thus reinvested A with the land included in the grant, this might be a law impairing the contract made between the parties. But it is very clear that the same thing might be done by other words which it would be very difficult to bring within that phrase. If the legislature transfers property from A to B without consideration, it may be void as taking private property without just compensation, or as taking private property for private purposes. But how could it be considered as a law impairing the obligation of any contract? The law might in terms recognize the contract; might admit its validity. Under no circumstances could it be a law impairing the obligation of contracts, unless the property, was transferred back to the person from whom it had been purchased, and then only, we think, when this was done by simply annulling the original grant.
The case of Terrett v. Taylor, 2 which came before the court in 1815, needs more careful examination. It was an appeal from the Circuit Court of the District of Columbia, which then included the county of Alexandria, originally ceded by Virginia, and, in 1846, ceded back to that State. It was not, therefore, a
1 Mr. Justice McLean, who was inclined to carry the prohibition further than perhaps any other judge who ever sat on the bench, except Justices Story and Wayne, doubted whether it should have been extended to executed contracts. Charles River Bridge v. Warven Bridge, 11 Pet. 578.
» 9 Cranch, 48.
case brought up to the court under the 25th section of the Judiciary Act.
In provincial times, the Anglican Church had been the established church of Virginia, and parishes were organized, and the parsons were seised, as of freehold, of the property of the parish, as corporations sole, according to the ecclesiastical law of England. At the Revolution, the church was disestablished; but statutes were passed in 1776, 1784, and 1788, confirming the title of the respective parishes to the church property, and authorizing the church-wardens and other trustees to hold the same in trust for the parishes. By subsequent statutes, one of which was enacted after, the separation of Alexandria county from Virginia, and consequently could have no application to the property in suit, these statutes were repealed, and the property appropriated to the support of the poor. These subsequent statutes were declared unconstitutional.
Mr. Justice Story, who delivered the judgment of the court, held that the church property in Virginia was not public property, but the property of the several parishes, and did not become the property of the State by the Revolution and the disestablishment of the church. <
"Had the property thus acquired," says he, "been originally granted by the State or the king, there might have been some color (and it would have been but a color) for such an extraordinary pretension. But the property was, in fact and in law, generally purchased by the parishioners, or acquired by the benefactions of pious donors. The title thereto was indefeasibly vested in the churches, or rather in their legal agents. It was not in the power of the crown to seize or assume it; nor of the parliament itself to destroy the grants, unless by the exercise of a power the most arbitrary, oppressive, and unjust, and endured only because it could not be resisted."
If this were so, then the statutes declared unconstitutional conflicted with that article of the constitution of Virginia which provided that the general assembly should not pass "any law whereby private property should be taken for public uses without just compensation;" and the manner in which this case came before the court presented the question for its decision. Whether the property was public or private, the statutes repealed constituted a legislative grant, release, or confirmation of the land to the several parishes, which was a contract protected by the Constitution within the decision of Fletcher v. Peck.
The further remarks of Mr. Justice Story in regard to corporations were purely obiter dicta. No direct reference is made, in the opinion, to the prohibition in regard to contracts, but the statutes are declared in general terms to be contrary to both the Federal and State constitutions. The case, therefore, when thus examined, goes no further than Fletcher v. Peck. The same may be said of Pawlet v. Clark,1 decided at the same term, which also came up from the Circuit Court. It may be well, however, to add, with respect to Terrett v. Taylor, first, that the judgment was only the judgment of a majority of the court, — and it is understood that Chief Justice Marshall was the dissentient judge; and, secondly, that the doctrine of the court in regard to the nature of the church property directly conflicts with that which has been claimed by the English Parliament, and which has had a practical application to the property of the Irish Church. On the continent of Europe, too, and notably in Italy, the legislative bodies treat church property as property that can be legitimately appropriated by the legislature to secular purposes.
In these cases, the court, although it had given a broad and liberal construction to the prohibition upon the States in regard to contracts, had not extended it beyond classes of contracts which might, not unfairly, be considered as falling within the spirit and intent of the words used. Between the cases, however, of Fletcher v. Peck and Terrett v. Taylor, a case came before the court which was the first step towards the later doctrine, and towards construing the prohibition as one that imposed upon the court the duty of preventing all unjust legislation that could by the broadest meaning be brought within its terms. "We must be permitted to say," said Mr. Justice Miller, in his able dissenting opinion in Washington University v. House,2 " that, in deciding the first of these propositions, namely, the validity of the contract, this court has, in our judgment, been, at times, quick to discover a contract that it might be protected, and slow to perceive that what are claimed to be contracts were not so, by reason of the want of authority in those who profess to bind others. This has been especially apparent in regard to contracts made by legislatures of States, and by those municipal bodies to whom, in
1 9 Cranch, 292. s 8 Wallace, 439, 442.
a limited measure, some part of the legislative function has been confided." Boni judicis est ampliare jurisdictionem.
The case of New Jersey v. Wilson,1 decided in 1812, was a case, in our humble opinion, wholly distinguishable in principle from Fletcher v. Peck, and from that class of cases to which the prohibition in the Constitution was meant to apply.
The remnant of the tribe of Delaware Indians had claims to a considerable portion of lands in New Jersey, which the government desired to extinguish. For this purpose a convention was held in 1758, and a proposition was made by the Indians, the basis of which was that the government should purchase a tract of land on which they might reside; in consideration of which they would release their claims to all other lands in New Jersey south of the river Raritan. This proposition was assented to, and the legislature passed an act to give effect to this agreement. This act, among other provisions, authorizes the purchase of lands for the Indians; restrains them from making leases or sales, and enacts " that the lands to be purchased for the Indians aforesaid shall not hereafter be subject to any tax, any law, usage, or custom to the contrary thereof in anywise notwithstanding." In 1801, the Indians, with the consent of the legislature, sold the lands thus conveyed to them. The act authorizing the sale contained no reference to the privilege of exemption from taxation. The court held that the exemption followed the land into the hands of the purchaser, and was a contract protected by the Constitution.
With the highest reverence for the Chief Justice who delivered the opinion of the court in tins case, we are constrained to question the correctness of this decision. We do this the more readily, because the case was submitted without argument, and because also it involves a principle which, while steadily adhered to by the Supreme Court, has never been generally assented to by the profession.
In the first place, this was not a private contract in respect of its subject-matter, but was an agreement in regard to the prerogative right of taxation, — a prerogative, as Chief Justice Marshall has said, essential to the existence of government. It did not, therefore, come within the language of the prohibition contained in the ordinance of 1787, which the framers of the Constitution thought too broad to impose upon the States.
i 7 Crunch, 164.